STB takes new look at "paper barriers"

The Surface Transportation Board has announced a proposal to require disclosure of additional information concerning interchange commitments—known as "paper barriers"—underlying a lease or rail-line sale filed with the board.

"Long-term interchange commitments can affect the competitive environment for years to come," noted the agency. "The goal of the disclosures is to encourage transactions that are in the public interest, while ensuring that the agency, as well as other interested parties, have sufficient information to judge whether competitive issues require detailed examination."

An interchange recommitment limits the ability or incentive of a purchaser or lessee of a rail line to interchange traffic with railroads other than the line's parent carrier. The board's rules currently require that a party seeking board authority to sell or lease a line disclose an interchange commitment in the transaction. The board's proposed rule would require a party to include with its initial filing additional information on any interchange commitment's impact on shippers and on the purchaser or lessee railroad.